After the demise of the Second Triumvirate, Augustus restored the outward facade of the free Republic, with governmental power vested in the Roman Senate, the executive magistrates, and the legislative assemblies. In reality, however, he retained his autocratic power over the Republic as a military dictator. By law, Augustus held a collection of powers granted to him for life by the Senate, including supreme military command, and those of tribune and censor. It took several years for Augustus to develop the framework within which a formally republican state could be led under his sole rule. He rejected monarchical titles, and instead called himself Princeps Civitatis ("First Citizen"). The resulting constitutional framework became known as the Principate, the first phase of the Roman Empire.

The reign of Augustus initiated an era of relative peace known as the Pax Romana (The Roman Peace). Despite continuous wars or imperial expansion on the Empire's frontiers and one year-long civil war over the imperial succession, the Roman world was largely free from large-scale conflict for more than two centuries. Augustus dramatically enlarged the Empire, annexing Egypt, Dalmatia, Pannonia, Noricum, and Raetia, expanded possessions in Africa, expanded into Germania, and completed the conquest of Hispania.

Augustus died in 14 AD at the age of 75. He may have died from natural causes, although there were unconfirmed rumors that his wife Livia poisoned him. He was succeeded as Emperor by his adopted son (also stepson and former son-in-law), Tiberius.